Reasons Why Social Media is able to Help Your Business

August 09, 2009 | Willis Wee

Social media websites were initially created purely for sharing and interacting with friends. So why the heck are there so many businesses flocking to be part of this in recent years? The answer is obvious – social media is able to help them gain a competitive advantage over rivals.

And this leads on to another tricky question: Why is social media able to help your business?

Read on to find out more.

1. That’s where the people are

Forward thinking marketers would definitely see the benefits of taking the plunge into social media. That’s where the people are! More than 250 million users are on Facebook, and Twitter is growing at lightning speed. According to Compete, Twitter jumped from 5,979,052 unique visitors in Jan 2009 to 22,997,148 in Jun 2009. Not to mention other big players like MySpace, YouTube and Flickr!

2. The people prefer word of mouth

Bombarded by ads every single day, consumers are getting more skeptical and desensitized.

Who would they trust? Whose words are more valuable?

Probably their friends, relatives and families! These are the people who would truly recommend good products that they have tried themselves. These are the average Joes with real problems that products are trying to solve; not celebrities with perfect bodies and great complexions.

This is why so many businesses are placing their bets on social media. It encourages word of mouth. Facebook tells you how many of your friends are fans of Blackberry Smart Phones. Twitter encourages your friends or people you know to retweet links that direct them straight to businesses’ websites. YouTube enables businesses to create videos that are buzz worthy enough to be passed on to millions.

With that, what more do I need to say?

3. It can get you a higher ROI

Many companies have enjoyed higher ROI with the help of social media marketing. Why? Because social media marketing generally requires little investment but the returns are substantial.

The best example would definitely be Dell who has claimed to make more than $3 million in revenue through its Twitter account, @DellOutlet. In this case, the investment is nothing compared to the returns. @StefanieAtDell was the investment and she was hired to tweet for Dell. Her job was to post promotions and new product links to followers and answer their questions. Followers who are interested in Dell’s products are directed to its website so that they can find out more or make purchases. Not only did Dell’s Twitter account encourage sales, followers became more aware of its products and promotions and would be more likely to think of it when the need arises. These are all returns to the company in the long term.

With all that said, it is important to know that not all tweets must come with an agenda. Spark a couple of truly sincere conversations to make your presence real and less mercenary (it is fun too!). You wouldn’t find that hard if you love social media; and only then would you succeed with it.

4. It can help you build relationships with customers

More companies now understand that customer experience is everything, and are putting a lot of value on building solid relationships with customers. Consumers no longer want to know you as a corporation. They want you to be human. They want you to know them as a friend and they want to be involved. In another words, no more red tape but a direct channel for them to feel closer to your brand. Consequently, many sought the help of social media to keep in touch with customers to build awareness, exposure and a long term relationship.

One way to do that is through a corporate blog. Providing great tips and content about your industry would let people know that you are an expert. If you are in the dental equipment business, you could write a blog sharing simple dental tips. Consumers would feel like you care and are truly there to help. Ideally, when a potential client visits your website he should see an active and welcoming blog, updated with insightful tips and advices. This would create a great impression on your company and motivate him to be involved by sharing your blog link and making comments. Constructive feedback can also be collected from the blog and actions could be taken to improve the customer experience.

Another way to build relationships would be through a Facebook page. Fans can feel your presence part of your brand. Like a friend, they are kept posted on what your company has been up to and what’s coming up. By keeping them involved, they feel significant and heard.

To put it simply, social media tools can help businesses build informal and genuine relationships with customers.

5. It can help you understand a specific community

Being part of a particular social media community, you are given an opportunity to observe what people are sharing and talking about. Notably with Twitter and Plurk, you can easily find out recent hot topics and follow the discussions revolving around them.

So how does this help in your business? It’s all up to your creativity. For example, knowing that Harry Potter is a recent hot topic, you could offer related promotions like “Win 2 free Harry Potter PREMIER tickets with purchases of more than $100″ or perhaps start a Harry Potter discussion with your Facebook page fans. Handled properly, your promotions or discussions could go viral easily.

As mentioned earlier, social media helps establish a direct communication channel with your consumers and get you valuable feedback. Whether the comments are positive or negative, you would probably be the first to hear them. By keeping yourself in the loop, you are able to quickly contain any negative vibe, make improvements and turn the situation around. You would also be updated on what attracts your consumers in a specific community and grab opportunities that come with it.

Just be sure to keep an open heart and a listening ear. You wouldn’t want to end up in a Dell Hell situation.

6. It must be good when others are using it

With thousands of businesses using social media as their marketing tool, it is tempting for other businesses to follow suit. According to Forrester Research, despite the recession, more than 50% of marketers are increasing their spending on social media this year. If you think that there must be good reasons for them to do so, you are right. However, like any business decision, it is always vital to do some research before embarking on your social media campaign.

Although access to a social media tool is just a registration away, a successful social media campaign requires time and discipline. As emphasized previously, you must love social media to succeed with it. No one wants to follow someone who seldom updates and no reader would keep up with a blog that publishes once every 2 to 3 months. Most of all, no one appreciates a half hearted or wholly self-interest motivated effort.

Think twice before engaging your business in social media. Be prepared before doing so.